Utility rate bill awaits NM Senate action

LAS CRUCES >> A company has its eye on Doña Ana County to operate a facility that would employ 200 to 300 workers at an average salary of about $41,000 per year.

The problem, though, is that the company could locate somewhere else like El Paso where it can obtain a reduced electrical rate, said Davin Lopez, president and CEO of the Mesilla Valley Economic Development Alliance.

"That's the biggest issue right now holding back the deal," Lopez said. "We have a 16 percent cost differential between electrical rates in El Paso versus Doña Ana County."

MVEDA supports a bill in the New Mexico Legislature that would allow larger companies and utilities like El Paso Electric to negotiate a reduced rate. Lopez said it would be an important tool in economic development efforts.

House Bill 296 was passed on Friday and now sits in the Senate Conservation Committee. A similar Senate bill, SB 283, is on the Senate calendar.

The legislative session ends at noon on Thursday.

"We're a little concerned that some legislators would like to see the bill not have time to get through," Lopez said.

MVEDA reports that not every company would qualify for an economic development rate. To qualify, a business would have to:

• Construct at least a 1 megawatt facility in New Mexico

• Add at least 20 full-time jobs in New Mexico with a minimum salary of $40,000

• Invest $5 million at one location and operate in New Mexico for at least 10 years

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• Derive at least 50 percent of sales revenues from outside the state

Qualified businesses must be certified by the Economic Development Department and can receive the EDR for up to seven years.

Not everyone supports the legislation.

Liliana Castillo of Conservation Voters New Mexico said her group's main concern is that the state Public Regulation Commission would not have a say in the rates.

"It's taking out the protection for other ratepayers (of) the elected body that oversees the rate making of utilities," Castillo said. "The bill states that the PRC shall allow the rate go into effect without a hearing."

Castillo said the concern is that other ratepayers — individuals and smaller businesses — could be charged more.

Staet Rep. Bill McCamley of Mesilla Park voted for the House bill but said on his Facebook page that "this was the hardest vote I had to take up here this year."

Still, he voted for the bill because he believes a raise in rates "will probably be fairly minimal," and he believes the job impact in Doña Ana County could be significant.

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